Income Beginner: Introduction to Deposit Accounts

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1.
The simplest kind of deposit account to set up and maintain is a _______.
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Passbook account. A passbook account is easy to start, offers immediate access to funds, and requires low minimum balances.
2.
Asset management accounts make tax preparation easy.
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True. Combined statements listing all your financial transactions make it easy to find the information you need to prepare your return.
3.
How much of your deposit account is insured by the FDIC or NCUA?
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$250,000 ($250,000 for retirement plan accounts). The FDIC or NCUA insures each depositor up to these limits.
4.
An account that combines savings, checking, credit/debit card services, and a line of credit in one account is a(n) _______.
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Asset management account. An asset management account combines many banking and investment features in one account.
5.
Because deposit accounts pay relatively low yields, investors have little need of them.
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False. Deposit accounts can be useful tools for accumulating investment capital, sheltering funds during market downturns, and maintaining a supply of liquid cash.